Bizarre post-Brexit pre-holiday stock market rally continues

Bizarre post-Brexit pre-holiday stock market rally continues

Dow, S&P 500, NASDAQ up again in Friday trading, though likely to drop somewhat near pre-Independence Day Holiday close. Wasn’t Brexit supposed to kill us all?

Cartoon by Branco. Republished with permission and by arrangement with LegalInsurrection. (See below.*)

WASHINGTON, July 1, 2016 – It was a week ago today that the Maven delivered his last column prior to heading off on an ill-timed personal holiday—at least in terms of trading the stock market. Since that time, he’s had only brief glimpses of Wall Street’s death and subsequent resurrection, courtesy of poor connectivity in Ohio’s rural hinterlands. (Actually, connectivity is available, generally, but it’s stultifyingly slow and generally useless for trading and fast research.)

Today, we’ll make a stab at trying to catch up to the kind of action we expected after the results of the Brexit tally came in—action that has largely matched our expectations. Thus far.

We’d predicted that U.S. markets, at least, would get hammered hard once the pro-Brexit results were announced in the U.K. Earlier last week, it’s apparent that politicians, their wealthy supporters and (of course) the media worked to game the pre-Brexit vote polls to indicate the “Remain” vote was winning, in order to suppress pro-Brexit voter turnout. Sources report that wealthy pro-eurozone investors and industrialists actually placed huge “Remain” votes with London’s famously accurate bookies in order to change the odds favoring their position.

Whatever the case, money and spin indicated that Brits would vote to “Remain” in the EU last Thursday. But during the day, odds rapidly changed, and pro-Brexit voters swamped the largely elite, urban pro-EU elites, causing massive market turmoil last Friday and this past Monday, with elites, wealthy corporate bigwigs and headline-trading HFT idiot-machines alike dumped stocks like there was no tomorrow, making nasty, condescending comments on the way out, impugning the intelligence of the pro-Brexit troglodytes who dared ignore the received wisdom of their far smarter betters.

Almost as if in response, this week’s buying binge jumped out of the gates in a millisecond on Tuesday, like a starving greyhound bound and determined to catch and devour a juicy-looking mechanical rabbit. While the snapback rally has bounced to and fro for the rest of this week and shows signs of fading somewhat today, most investors who held onto most of their positions in the face of concentrated government, media, academic and entertainment sector sneering are now roughly back where they were pre-Brexit vote.

It’s all a testimony to the brain-dead globalist “intellectual” and ruling classes who have entirely lost touch with the fading but still influential middle-class electorate. These are the folks accustomed in general to work hard in order to earn greater rewards while helping their children to advance up the economic ladder—an activity that’s become largely impossible as Western governments and phony, wealthy “socialists” regulate their economies and individuals to death, squashing all hope of growth and economic betterment.

Adding insult to injury, these same government idiocrats have been importing boatloads of largely unassimilable aliens into their countries to crush wage growth and increase corporate profits, not to mention destroying millions of high-paying middle-class jobs that their (former) holders had struggled for lifetimes to achieve.

So, last week, Britain experienced what the Maven likes to call a major “Popeye Moment.” Those who still remember those vintage cartoons can already envision their favorite Sailor Man, pounded by the villainous Bluto into a pulp, pulling out his can of spinach, gobbling it down, reviving miraculously and declaring, “I’ve stood all I can stands, and I can’t stands no more!”—before pummeling Bluto into oblivion.

Congrats to the Brits for their exciting and long-in-coming Popeye Moment. U.S. voters will have a chance to repeat that feat this autumn by voting Washington’s largely Democrat charlatans out en masse—or at least by sending Hillary to oblivion and perhaps even to the federal penitentiary, though that might be too much to expect in today’s corrupt system.

At least Obama will be out of Washington (we hope), living it up in the socialist lap of luxury somewhere in a gated manse in Hawaii. Congress should make sure they deny him the post-administration use of taxpayer paid-for jet travel. You know. Becausen of global warming climate change.

At any rate, “that was the week that was,” as they used to sing in that old British comedy news series that inspired our own U.S. “Laugh-In” in the 1960s. Politics and real life collided. And, at least for one brief, shining moment, real life triumphed. It remains to be seen how far this revival of democracy will spread. But whatever happens, every post-Brexit confrontation between the people and their would-be masters will have a profound effect on market action.

So stay tuned to the news, such as it is. It will make—or lose—you plenty of money for the balance of 2016.

Trading diary

With very iffy connectivity, we did very little over the past week. Happily, that’s what we intended to do anyway. We did sell our IPO shares of US Foods Holding (symbol: USFD) when we chanced to spot an uptick for a nice approximately 12 percent profit.

Otherwise, we watched our portfolios take a humongous two-day beating before rising, like the entire market, from the dead.

Our asset manager-robber baron investment management companies—Blackstone (BX), Carlyle Group (CG) and KKR (KKR)—are still hurting, as they’re still in the tank along with the financials. This entire group continues to get a haircut. That’s because they’d all benefit—particularly the banks and insurance companies—from higher interest rates, which, at this point, may not show up until the next millennium.

However, this trio of stocks still pays hefty, if irregularly priced dividends and, better yet, will continue to take advantage of currently depressed stock prices in growth or new business areas, the better to buy stuff now and sell it at a big profit later. So we’re going to stick with these horses for now and wait the current damage out.

Aside from that, we are, in general, still waiting for the smoke to clear from this week’s market chaos.

Due to the Independence Day holiday, both the market and we will be off Monday. Now that we’ve started a new quarter, we expect post-holiday action to be anemic, so don’t be surprised if we start slipping into the red next Tuesday. The market may have set off most of its fireworks early. Ergo, buying and selling right now, for us at least, is probably ill advised.

So enjoy a happy and safe holiday. Let’s remember what it took for our Founding Fathers to win America’s basic freedoms. And let’s vow to honor them by reclaiming for this country all the freedom that we’ve come very close to losing in the early years of the 21st century.

See you Tuesday.


*Cartoon by Branco. Republished with permission and by arrangement with LegalInsurrection.

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Terry Ponick
Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17